| ESTATE |
LEGAL CITATION: |
M.C.L. 205.201 et seq.; 1899 PA 188. |
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| YEAR ADOPTED: |
1899 (referred to as Inheritance Tax until amended by 1993 PA 54.) |
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| BASIS OF TAX: |
Privilege of transferring an interest in the property of a decedent. |
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| MEASURE OF TAX (BASE): |
Gross estate as determined under federal internal revenue code.
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Estate Tax Elimination
The federal tax-reform package passed in 2001 eliminated the allowable federal credit over a four-year period beginning in 2002. The State of Michigan took no action to offset the federal change and therefore the state Estate Tax is no longer effective. Tax revenues, which approached $200 million in FY01, will not be collected by the state in the future.
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| RATE: |
Tax imposed up to maximum allowable federal credit for state inheritance taxes paid. |
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| ADMINISTRATION: |
Michigan Department of Treasury, Bureau of Revenue. |
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| REPORT AND PAYMENT: |
Due by same date as federal estate tax. |
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| DISPOSITION: |
General Fund. |
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| 2006-07 COLLECTIONS: |
$1,007,000 |
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| Estate Tax Law Changes |
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Historic Michigan Estate Tax Revenues
| A |
1899 |
PA 188 |
Inheritance Tax established (Direct heirs 2 - 8 percent; collateral heirs 10 - 15 percent). |
| B |
1978 |
PA 628 |
Increased maximum tax rate on direct heirs to 10 percent; increased minimum tax rate on collateral heirs to 12 percent and maximum tax rate to 17 percent. |
| C |
1993 |
PA 54 |
Inheritance Tax replaced by Estate Tax. |
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THE NUMBERS BEHIND THE CHART |
